Business Law Mid-Term & Final Exam

Ultrahazardous activity is activity that:

"necessarily involves a risk of serious harm to the person, land, or chattels of another, which cannot be eliminated by the exercise of the utmost care" and "is not a matter of common usage."

In most states ____ doctrines allow one to match force for force.

"stand your ground"

The amount of money involved in asbestos liability litigation is at least:

$100 billion

In an action alleging environmental damage, by use of the common law of trespass, the plaintiff must show that the:

"invasion" of the plaintiff's property by the defendant's pollution is physical

Under the ____, lobbying to influence a legislature is not illegal, even if the purpose is anticompetitive.

Noerr-Pennington doctrine

Real property includes which of the following:

OIL, LAND, TREES, BUILDINGS

Under the Foreign Corrupt Practices Act, US companies must meet which of the following requirements?

accounting and bookkeeping requirements and internal accounting controls

To defeat a defense of qualified privilege, the plaintiff must establish that the defendant acted with:

actual malice

The Seventh Amendment of the U.S. Constitution:

addresses the right of government to seize property addresses the right of persons to bear arms addresses the right of persons to trial by jury in criminal cases addresses the right of persons to engage in business none of the other choices are correct

The Sixth Amendment of the U.S. Constitution:

addresses the right of persons to trial by jury in criminal cases

The Constitution was amended almost immediately to ensure that there was:

adequate protection for individual rights

An alibi is an example of a(n):

affirmative defense

The duties of a principal to an agent do not include:

allowing the agent "significant discretion"

Negligence is:

an act that results in harm to another to whom the person owes a duty of care an omission that results in harm to another to whom the person owes a duty of care

Operation of law provides agents with the authority to act beyond the authority granted by the principal when:

an agent has a good idea an agent has an opportunity to make a profit for the principal through his actions an agent understands all the risks the principal fails to make the right decision Correct answer: none of the other choices are correct

A covenant is:

an agreement attached to a piece of land that "runs" with the land

The decision of an appellate court is the:

one that receives the majority vote of the judges

Which of the following is not a condition needed to establish adverse possession:

open possession actual possession exclusive possession hostile possession Correct answer: all of the other choices are needed to establish adverse possession

An agency may be established by:

operation of law or by oral agreement of the parties or by written agreement of the parties

The reasonable person standard compares the actions of the wrongdoer/tortfeasor with those of a hypothetical person known as the reasonable person. The standard of care that the law presumes the reasonable person meets is:

ordinary care or due care

Privity is:

an agreement to privacy an understanding between friends a "gentlemen's agreement" an agreement to agree in the future Correct answer: none of the other choices are accurate

A settlement conference is:

an attempt to resolve a matter without trial, but under the supervision of a judge

Because of the ____ an agent may not represent another party whose interests are in conflict with those of the principal.

duty of loyalty

A place of entry in a country that does not assess duties or tariffs on products is called:

duty-free port

The First Amendment provides protection for which of the following kinds of speech?

political speech by private citizens political speech by corporations commercial speech by businesses commercial speech by private citizens all of the other choices

The legal document that authorizes a person or a company to act as an agent for a principal is called:

power of attorney

The elements of the tort of interference with a prospective advantage (relationship) include:

predatory behavior

The Robinson-Patman Act concerns:

price discrimination

Unlike in the United States, in Britain:

private individuals can bring criminal charges against others

Under the strict liability doctrine, the focus is on the ____, rather than the reasonableness of the conduct of the manufacturer.

problem the plaintiff had understanding the manufacturer's instructions problems with advertising problem created by careless production workers problems with the manufacturing process none of the other choices are correct

The Restatement (Third) of Torts refers to strict liability in tort as:

product injury law product quality assurance law product service law consumer protection law none of the other choices are correct

The Food and Drug Administration:

prohibits the sale of drugs without FDA approval

A(n) ____ is a note promising to repay borrowed money, probably with interest.

promissory note

Which of the following is NOT usually part of the documentation required for payment from a buyer's bank when a letter of credit has been issued:

proof of profit

The primary purpose of RCRA's manifest system is to:

provide a way to track hazardous wastes from their origin to their final destination

A major purpose of tort law is to:

provide compensation for injured parties by wrongdoers

A company injured by an act that violates the Sherman Act may sue for only:

punitive and actual money damages actual money damages damages incurred in the "ordinary course of business" no damages; only the government can sue to enforce the law Correct Answer: none of the other choices

The powers of a debtor in possession are balanced by:

the underwriter in charge the grievance committee the lienor's committee the party of rights Correct answer: none of the other choices

The length of witness examinations is controlled by:

the witness the plaintiff's lawyer the jury the defendant's lawyer none of the other choices are correct

Which of the following is part of the FTC's three part test for deciding whether a particular act or practice is deceptive:

there is a misrepresentation or omission of information in a communication to consumers the deception is likely to mislead a reasonable consumer the deception is material Correct answer: all of the other specific choices are correct

Which of the following is part of the FTC policy statement for determining if a practice is deceptive?

there is a representation or omission of information in a communication to consumers and the deception is likely to mislead a reasonable consumer and the deception may cause physical harm to consumers

Which is true about an arbitration decision:

there may be punitive damages

In cases where a person is charged with a felony, if there is to be a trial:

there must be a grand jury indictment there must be a grand jury indictment only if it is a federal case there must be a grand jury indictment only if it is a state case there must be a grand jury indictment if the crime carries the possibility of more than ten years in prison none of the other choices

Parties can appeal a court's decision if:

there was a failure by the trial judge to admit or exclude certain evidence there were improper instructions being given to the jury there was granting or denying of motions to dismiss the case all of the other specific choices are correct

In Chambers v. Travelers Companies, where Chambers sued for defamation after she was fired for her behavior, which included failure to reveal certain information about a business trip, but the district court held for Travelers, and the appeals court agreed because:

there was no evidence of actual malice by the employer

If a third party observes a fraud:

they cannot sue

Businesses must maintain company records in a coherent manner so that:

they may be accessed in case of a lawsuit

Today, international law can be enforced largely:

through international arbitration and in the courts of an individual country

A ____ requires immediate payment by the drawee to the payee.

time draft balloon draft bank draft personal draft Correct Answer: none of the other choices are correct

The duty of an agent not to mix personal funds with the funds of the principal is the duty:

to account

A(n) ____ means that that certain business agreements or activities will automatically be held to be illegal if found to exist.

per se rule

Following the opening statements at a trial, the:

plaintiff goes first since she has the burden of proving that her arguments are correct

New plants may be built in Prevention of Significant Deterioration (PSD) areas if the:

plant installs Best Available Control Technology and the plant owner demonstrates the plant will not cause the area's maximum allowable increase to be exceeded

The formal statements made to the court by the parties to a case that list their claims and defenses are called:

pleadings

Lex meractoria refers to:

rules governing commercial transactions in Europe in the Middle Ages

Which of the following is unlikely to be classified an intentional tort:

running at a stranger while waving an iron pipe at them spreading rumors that someone robbed a bank in the past a man grabs a woman he does not know and kisses her despite her protests secretly making tapes of your roommate's phone calls all of the other choices are likely to be intentional torts

Which of the following is a nonpoint source of water pollution:

runoff from construction sites runoff from logging and mining operations runoff from streets runoff from agriculture Correct answer: all of the other choices are correct

The sale of stock in the company or the sale of negotiable instruments that are subject to securities regulation is known as:

sale financing debt financing credit financing bankruptcy Correct answer: none of the other choices are correct

Failure of a business to maintain its company records in such a way that they may be accessed during a lawsuit may result in:

sanctions by the court

The Fifth Amendment protects individuals against:

self-incrimination

In Massachusetts v. EPA, where Massachusetts and other states sued to force regulation of greenhouse gases from vehicles, the Supreme Court held that:

since the EPA recognizes that there is a causal connection between man-made greenhouse gas emissions and global warming, the refusal to regulate such emissions "contributes" to Massachusetts' injuries

John refuses to pay his bill due at a store. The store owner grabs John by the shirt, screams and him, and demands the money "or else." John is shaken but unhurt. John would most likely sue for the tort of:

slander assault invasion of privacy negligence none of the other choices

Most tort suits are filed in:

state courts

If a crime is not prosecuted within the time set by the ____, then the state loses the right to bring suit:

statute of probable cause statute of limited time statute of dissipation statute of prosecution none of the other specific choices is correct

Citizens who sought relief from pollution through the common law relied on which law:

strict liability for abnormally dangerous activities nuisance trespass negligence Correct answer: all of the other choices

One evening you eat at the salad bar of a restaurant. The potato salad looks a bit odd, but you stuff it down anyway. You get food poisoning from the salad, which was left at room temperature too long. If you sue the restaurant, they are likely to be:

strictly liable for violating implied warranties that exist for food

Early trade customs for international commerce centered principally on the rules governing:

the law of the sea

In Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council concerning a Virginia law prohibiting the advertising of prices of prescription drugs the Supreme Court held that:

the law was appropriate because people must be protected from their own ignorance the law was constitutional the law hindered interstate commerce the law promoted interstate commerce none of the other choices are correct

Property is:

the legally protected expectation of being able to use a thing for one's advantage

A man was injured while riding a mechanical bull owned by an independent contractor at a state fair. He paid to ride the bull and signed a form that he understood the risk of injury. After he was injured, he sued the fair that provided the ride for negligence. You would expect the court held that:

the man assumed the dangers voluntarily so could not sue for the injuries he suffered

The debtor on a mortgage is known as:

the mortgagor

Written interrogatories are questions submitted by:

the opposing party

____ is when an agency is created because the actions of the principal may lead one to reasonably believe that the presumed agent has the authority to act for the principal.

Agency by estoppel

The Federal Trade Commission was established in:

1915

The Food and Drug Administration was created in:

1927

Rachel Carson's publication of "Silent Spring" increased public awareness of environmental concerns in the:

1960S

Although NAFTA was signed in 1992, it did not go into effect until:

1994

____ are drafts that mature on the payment date set in the future.

Balloon drafts Delayed drafts Lapsed drafts Real estate drafts Correct answer: none of the other choices are correct

NAFTA is a trading agreement that promotes free trade. Which of these countries is a member?

Canada

Refer to Fact Pattern 12-1. Given her situation, if her income is above average Gena would likely file for a:

Chapter 13 bankruptcy

In South-Central Timber Development v. Wunnicke, concerning federal and state regulation of Alaska timber processing, the Supreme Court held:

Congress may burden interstate commerce, but states may not unless allowed by Congress

A burden on another person's estate is a(n):

Easement

Under the ____, credit reporting services must allow consumers to see their credit reports annually for free.

Fair and Accurate Credit Transactions Act

"No state shall...deprive any person of life, liberty, or property, without due process of law..." is a part of the:

Fourteenth Amendment

Which of the following state taxes is unconstitutional:

Hawaii imposed a 20 percent tax on all alcoholic beverages except for local products Michigan exempted from state income taxes the retirement benefits paid to state employees, but taxed all other retirement income, such as retired federal government employees' benefits North Dakota imposed state sales taxes on out-of-state firms doing mail-order business with North Dakota residents all of the other specific choices are unconstitutional

In Thayer v. Hollinger, Hollinger owned land next to lakeshore lots that he developed. He shared a common road with the lakeshore lot owners who used trails on his property that were accessed from the road. Hollinger claimed he could block use of the trails. The lot owners claimed an easement to use the trails. The courts held that:

Hollinger granted the lot owners an easement as part of the sale of the land, which included use of the road and trails leading from the road Hollinger could not block access to the trails without permission of the lot owners because they had used the trails for so many years the lot owners had an easement by adverse possession that allowed use of the trails as they openly used the trails for more than seven years the lot owners could establish easements by adverse possession to use the trail if they showed open use of the trails for at least seven years Correct answer: none of the other choices

Jemal is playing basketball at a school's outdoor court. Kevin asks if he can join the game. Jemal agrees. After playing for 15 minutes, Kevin is knocked to the ground. His wrist breaks when he hits the concrete. If Kevin sues Jemal for his injury, a court will probably find:

Jemal not responsible due to Kevin's assumption of risk

In Smith v. Kulig, Smith was killed when visiting his friend who rented an apartment from Kulig, when the fire escape at the back of the building collapsed under Smith, the courts held that:

Kulig was not liable because Smith was a trespasser

Which of the following is not an category of intentional tort:

MURDER

____ is an agreement between a manufacturer, a supplier, and retailers of a product under which the retailers agree to sell the product at not less than a minimum price.

Minimum resale price agreement Resale price fixing Resale price enhancement Price fixing Correct answer: none of the other choices are correct

In Hughes v. Oklahoma, Oklahoma law forbid the export of natural minnows, to help protect the state's natural resources. When this law was challenged, the Supreme Court held:

Oklahoma has a paramount interest in preserving its natural resources, so the law stands Oklahoma has no interest in preserving minnows, so the law fails Oklahoma was improperly "taking property without compensation" regulation of fish falls under the Fish and Wildlife Service, so Oklahoma preempted a federal law none of the other choices

In Bridge v. Phoenix Bond, where Phoenix Bond sued Bridge for filing false documents related to tax lien purchases, the Supreme Court held that:

RICO's text provides no basis for imposing a first-party reliance requirement

"A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed" is the:

Second Amendment of the U.S. Constitution

"No person shall be...compelled in any criminal case to be a witness against himself." is the:

Second Amendment of the U.S. Constitution First Amendment of the U.S. Constitution Sixth Amendment of the U.S. Constitution Fourth Amendment of the U.S. Constitution none of the other choices are correct

Tim has been selling illegal drugs in his $1,000,000 house. When he is caught by the police, they confiscate the house. Tim sues the police for imposing excessive fines since the drugs he was selling were only worth $1,000. The court is likely to find that:

Tim does not have a case because the confiscation is part of a rational and consistent scheme to deter drug dealing

The procedures for using liens are generally determined by:

UCC Article 2 UCC Article 9 UCC Article 5 Code of Federal Regulations Correct answer: none of these

The ____ promotes international trade by working to reduce trade barriers and to establish uniform tariff schedules and trade rules.

World Trade Organization

Jimmy must be at work no later than 7 AM on the days he works. Because he must hurry to get to work, he runs over a lady going across the street. She sues Jimmy and his employer for her injuries. She has:

a case against Jimmy, but no case against his employer

A check must have ____ as its drawee.

a court an individual a corporation an international backer Correct answer: none of the other choices are correct

Each state has both:

a criminal code and a nice code a federal criminal code and a county criminal code Correct Answer:none of the other choices are correct a civil code and a free code a civil code and a law code none of the other choices are correct

A warranty deed is:

a deed that promises that a good, clear title to the property is being conveyed by the grantor

An allegation by the defendant that that the law furnishes no remedy for plaintiff's claimed injury is known as:

a demurrer

In which of the following cases discussed in the text was the manufacturer held liable based on failure to warn:

a diet food producer that failed to provide adequate warnings about using the adult diet food as baby food

A tying arrangement occurs when:

a distributor is limited in who it can sell a product to a customer buys from two different suppliers there is a requirement that a certain amount of a product is purchased the area where a product can be distributed is limited Correct answer: none of the other choices are correct

The doctrine of sovereign immunity allows:

a domestic court to give up jurisdiction it holds over a foreign enterprise

Fact Pattern 8-1 Jill recently inherited money from her old aunt Maude. Jill decided to buy beach-front property in Beaufort, South Carolina. Jill's new property consists of 3 acres of land, with direct access to the ocean. When she bought the land there is no home on it, but she wants to build a beach home in the future. A year after she bought the lovely lot, the city of Beaufort rezones the land, prohibiting any building so that other residents can enjoy the view. Refer to Fact Pattern 8-1. When Jill buys her beach-front land she also buys the right to exclusive possession of and enjoyment of those 3 acres. What Jill has purchased is:

a fee simple estate

A specific tariff is:

a fixed tax amount applied to an import

Fact Pattern 14-1 Emile owns Emile's Used Car Emporium. Several people work for him at the Emporium. When Emile is gone, he leaves one of his best salespersons, Meg, in charge. Over the years, Emile has given Meg the authority to contract with vendors, negotiate sales, and conclude car sales contracts in his name. Refer to Fact Pattern 14-1. Emile gives Sally authority to execute all normal transactions connected with his business. In this case, Meg is:

a general agent

____ is a person who contracts with another to do something for him but who is not controlled by the other nor subject to the other's right to control with respect to his physical conduct in the performance of the undertaking.

a general agent

For the police to use a warrant to search for evidence they think may exist that is relevant to a suspected criminal act:

a judge must issue a warrant based on probable cause

Privity is:

a legal relationship

When a wrongdoer harms a person's interest in land or personal possessions, this is referred to as:

a misdemeanor a contractual breach breach of fiduciary duty a libel against the person Correct answer: none of the other choices

Which of the following types of speech are not protected by the First Amendment?

a pamphlet prepared by a gas company in support of the use of natural gas political speech by a person at a public facility such as a train station an advertisement listing the prices charged by a local doctor for her services all of the other choices are protected

Which of the following has the right to sue for violation of antitrust laws:

a private individual a small business a big business Correct answer: all of the other specific choices are correct

If a defendant makes a claim against a plaintiff, in response to the plaintiffs complaint against the defendant, the plaintiff responds by providing:

a reply

An easement is generally described as:

a right to use intellectual property a conversionary right to personal property a future interest in personal property a negative interest in personal property Correct answer: none of the other choices

Under the FTC's Used Car Rule the Buyer's Guide must contain:

a statement of the terms of any warranty offered with the car prominent statement of whether the dealer is selling the car "as is" and, if so, that the consumer must pay for any repairs needed after buying the car warning that oral promises are difficult to enforce, with a suggestion to get all promises in writing a suggestion that the consumer ask for an independent inspection of the car Correct Answer: all of the other choices are required

Under the FTC's Used Car Rule the Buyer's Guide need NOT contain:

a statement of the terms of any warranty offered with the car prominent statement of whether the dealer is selling the car "as is" and, if so, that the consumer must pay for any repairs needed after buying the car warning that oral promises are difficult to enforce, with a suggestion to get all promises in writing a suggestion that the consumer ask for an independent inspection of the car Correct answer: all of the other choices are required

In Hughes v. Oklahoma, the Supreme Court applied which test regarding the constitutionality of a state law prohibiting the export of minnows?

a strict scrutiny test

Ayau Distributors, which has stores in Ohio and Michigan, sells bedroom furniture for very low prices, but requires that buyers to also purchase a washing machine at a rather high price. This requirement probably is:

a tie-in sale that is legal under a rule of reason analysis because there is little market effect on the products

Illegal drug possession is an example of what is often called:

a victimless crime

Nominal damages are damages that are awarded for:

a violation that involves no actual damages to a person or property

After a judgment is entered in favor of plaintiff, what may the plaintiff seek if the defendant refuses to pay?

a writ of certiorari a writ of habeas corpus a writ of rejoinder a writ of payment none of the other choices

Compensation for injured parties accounts for ____ of the total cost of the tort system.

about two-thirds over 80% more than half about three-fourths none of the other choices are correct

Fact Pattern 8-1 Jill recently inherited money from her old aunt Maude. Jill decided to buy beach-front property in Beaufort, South Carolina. Jill's new property consists of 3 acres of land, with direct access to the ocean. When she bought the land there is no home on it, but she wants to build a beach home in the future. A year after she bought the lovely lot, the city of Beaufort rezones the land, prohibiting any building so that other residents can enjoy the view. Refer to Fact Pattern 8-1. Grady comes to Jill, after she was purchased the 3 acres of land and asks her if he can fish on her property. Jill tells Grady that she will be happy to allow him to fish on her land whenever he wishes, so long as he pays her $500.00 per year for the right. If Grady agrees and he and Jill write an agreement to this effect, what they have is:

an easement

A business can become involved in tort action in all of the following ways EXCEPT:

an employee commits a felony unrelated to his place of employment

Pre-bankruptcy counseling includes:

an evaluation of a person's financial situation a discussion of alternatives to bankruptcy a personal budget plan Correct answer: all of the other specific choices are included

The Racketeer Influenced and Corrupt Organizations (RICO) Act provides:

an extra weapon against organized crime

Leased property is assumed at law to have:

an implied warranty of habitability

Under Article 3 of the UCC, a draft is:

an unconditional written order to pay that involves two parties: drawer and payee; the payment is "on demand" only an unconditional written order to pay that involves three distinct parties: drawer, drawee, and payee; the drawee must be a bank; payment must be "on demand" a promise by one party to pay a certain sum of money to another party; two parties are involved: the maker and the payee; payment may be set at some time in the future an acknowledgment by a bank that it has received money from a customer with a promise from the bank that it will repay the money received at a specified date or upon demand; two parties are involved: a maker and a payee Correct Answer: none of the other choices

Senator Hotair, Mary's uncle, has become disgusted with Joe. At a press conference the Senator attacks Joe, calling him names, saying he is a disgusting person and must be crazy. This is printed widely. Joe wants to sue the Senator for defamation. He can sue:

and possibly win

Defenses of insanity and intoxication in criminal cases:

apply to about ten percent of cases apply to about twenty percent of cases are not allowed in Class A felony cases are not allowed in misdemeanor cases none of the other choices

The most widely recognized form of alternative dispute resolution process is:

arbitration

A foreign trade zone is a(n):

area where businesses can import goods without paying tariffs

Defenses to a negligent act include:

assumption of risk

Under the Export Administration Act, a general license:

authorizes a business to export non-sensitive goods

Firms that have water pollution permits must monitor their own performance and file what are called:

discharge monitoring reports

Which of the following activities is an example of an ultrahazardous activity:

crop dusting blasting with explosives transporting chemicals in a city all of the other specific choices are correct

Which of the following is an example of a class I medical device:

bandages

The tort defined as the intentional and wrongful interference with possession of personal property of another without consent is:

battery to property nuisance negligent property use conversion Correct answer: none of the other choices

Horizontal market division allows competing firms to:

be more efficient diversify into more markets hire fewer workers give better worker benefits Correct Answer: none of the other choices are correct

In Erichsen v. No-Frills Supermarkets, a woman who was shopping was seriously injured by a robber in the parking lot. She sued the store claiming that its failure to provide adequate security was a breach of its duty to her. The Nebraska high court held that the store could:

be sued for negligence

With negotiable instruments, the party to receive payment is the:

beneficiary

Title insurance:

binds the title company to insure that the title is as declared in the conveyance from the grantor to the grantee

The manipulation of biological processes to produce chemicals or living organisms for commercial use is known as:

biochemicalsynthesis bioethics biomanipulation biosynthesis Correct answer: none of the other choices are correct

The manipulation of biological processes to produce chemicals or living organisms for commercial use is known as:

biotechnology

Debt incurred by business includes:

both long and short-term debt

Fact Pattern 14-1 Emile owns Emile's Used Car Emporium. Several people work for him at the Emporium. When Emile is gone, he leaves one of his best salespersons, Meg, in charge. Over the years, Emile has given Meg the authority to contract with vendors, negotiate sales, and conclude car sales contracts in his name. Refer to Fact Pattern 14-1. Meg enters into a contract with the office supply vendor in Emile's name. Because the office supply vendor is a friend, Emile has always negotiated these contracts and he is angry with Meg when she tells him that she signed the contract. In this case, Emile is:

bound by Meg's action apparent or actual authority

A superseding cause is an act that:

breaks the causal connection between a person's act and the resulting harm to another

Racketeering includes:

bribery extortion mail fraud all of the other specific choices are correct

____ are often used in place of a partnership or corporation.

business trusts

A consumer buys furniture. The store gives the consumer $2,000 credit to be paid back over two years. The store fails to disclose the interest rate that it charges for credit. Under the Truth-in-Lending Act, the store is wrong for not listing the interest:

but the customer agreed to it, so there is no violation but the consumer's only recourse is to sue to cancel the contract and must give the consumer the goods for free as a result there is no violation because TILA does not apply to this transaction Correct answer: none of the other choices

Which of the following must be listed per serving portion on nutrition labels:

carbohydrates calcium fiber sodium Correct answer: all of the other specific choices must be listed

Negligence is:

carelessness in a legal sense

A ____ is a form of check in which the bank is both the drawer and the drawee.

cashier's check

Dumping is:

charging a lower price in foreign than in the home market

The ____ of an international contract sets out the official language by which the contract is to be interpreted.

choice of language clause

The Food and Drug Administration is NOT involved in:

cleaning environmental contaminants from food processing plants

For credit under a(n) ____ the terms define the credit period available to the customer and any discounts offered for early payment.

closed account specific account real account outstanding account Correct answer: none of the other choices are correct

In a(n) ____, the debtor makes a minimum monthly payment and more debt can be added to the account over time.

collections account installment account security account open account Correct answer: none of the other choices

Alex sues Lisa for $60,000 for damages suffered as a result of her negligence because she failed to place a sign on the door of her restaurant warning customers to "Watch Your Step" as they exited the building. A jury awards Alex $40,000 because Alex's intoxication made him 33% responsible for his injuries. Lisa avoided full liability because she showed:

comparative negligence

Which of the following is not a duty owed by the agent to the principal:

compensation

Statements of the facts necessary to claim that the plaintiff is entitled to remedy are included in the ____.

complaint

Which of the following is a NOT way to regulate imports:

complicated customs procedures government procurement policies safety and manufacturing standards Correct answer: all the other specific choices are ways to regulate imports

An arbitral hearing is:

conducted according to rules the parties choose normally an open-door proceeding less formal than a trial normally faster than a court trial all of the other choices

The ____ test states "A legal cause of injury is a cause which is a substantial factor in bringing about the injury."

considerable factor proximate factor sine qua non proximate cause none of the other choices

Employers may be liable for torts of employees that can be attributed to negligent hiring or supervision under the rule of law known as:

contractor liability tortious liabilitius there is no such rule as the employee only is responsible principal duty Correct answer: none of the other choices are correct

Which of the following is an intentional tort against property:

conversion

Which of the following results in judicial forums' general ineffectiveness with regard to resolving international commerce disagreements:

cost considerations jurisdictional barriers length of time to litigate legal uncertainties Correct answer: all of the other specific choices are correct

In In re Polar Bear Endangered Species Act Listing, the listing of the polar bear as a threatened specie was challenged. It is not endangered today but could be in the future. The listing by the Fish and Wildlife Service (FWS) was attacked as arbitrary and capricious. The appeals court held that:

courts may not review decisions of the FWS regarding such listings the listing was proper as FWS showed that the bear is in "imminent danger" of survival the listing was improper because the FWS failed to show that its survival was in danger unless very strange assumptions were made the listing was arbitrary and capricious as the FWS failed to justify its decision based on scientific evidence Correct answer: none of the other choices

Each year about 100 environmental offenses have been dealt with by government officials by:

criminal convictions

The Comprehensive Environmental Response, Compensation, and Liability Act defines which of the following as potentially responsible parties who can be held liable for cleanup costs and damages to natural resources from hazardous wastes:

current owners of a hazardous waste site prior owners of a site at the time of hazardous waste disposal any hazardous was generator who arranged for disposal at the site Correct answer: all of the other specific choices are correct

A manufacturer of a commercial french-frying machine was sued after someone using the machine reached in to retrieve an item that had fallen out of his shirt pocket. The plaintiff was seriously burned as a result. The appellate court upheld the trial court's decision that imposed liability on the manufacturer based on:

design defect

If a jury cannot reach a verdict, the judge:

declares a mistrial

The doctrine of comparative negligence permits damages to be:

decreased by the percentage of plaintiffs' injuries caused by plaintiff's negligence

Under the rule of strict liability in tort, to be successful an injured party must show that the:

defect in the product was the proximate cause of injury product in question was defective defect in a product caused it to be unreasonably dangerous losses were suffered all of the other choices

The specific tools of discovery include:

depositions written interrogatories orders for production of documents and requests for admissions orders for a mental or physical examination all of the other choices are correct

Which of the following is not a discovery tool used for obtaining information from the opposing party?

depositions written interrogatories requests for admissions mental examinations all of the other choices are discovery tools

Which of the following is NOT an example of deceptive advertising targeted by the FTC:

describing pastries made in America as Danish pastries

Servitudes are:

limitations or requirements about the use of property in general

Since the 1920s the primary method of local land control has been:

easements eminent domain tort suits taxation Correct answer: none of the other choices are correct

The theft of valuable business information, such as a trade secret is:

embezzlement racketeering internet fraud insider trading none of the other choices

The Truth-in-Lending Act:

encourages competition in financing consumer credit

To transfer an instrument made "to the order" of the payee, the payee must:

endorse the instrument deliver the instrument to a third party destroy the original instrument Correct answer: both a and b are necessary none of the other choices are correct

A person who volunteers with no expectation of being paid for her services is a(n):

exceptional agent universal agent agent who has an agency coupled with an interest special agent Correct answer: none of the other choices

In Japan business cards are:

exchanged formerly at first meeting and treated with respect

The trustee of a property in a trust has a duty to manage the property for the benefit of the:

executive owner leader executor none of the other choices are correct

____ takes place when the principal behaves as if he has the intent of ratifying an unauthorized agreement.

explicit ratification real ratification delayed ratification express ratification Correct answer: none of the other choices are correct

In Geczi v. Lifetime Fitness, where Geczi suffered an injury when a treadmill at Lifetime malfunctioned but a jury held Lifetime not to be negligent, the appeals court held that Lifetime was not liable because Geczi _____________.

expressly assumed the risk

Which of the following can be an example of tax evasion:

failing to file tax returns failing to report all income overstating expenses all of the other specific choices are correct

The determination of what are crimes and the kinds of punishments is limited by:

federal and state constitutions

The determination of what are crimes and the kinds of punishments are is limited by:

federal norms state norms international protocols federal and state administrative rules none of the choices are correct

Victimless crimes can be:

felonies or misdemeanors

Coch suffered from painful arthritis. Dr. Brooke prescribed an FDA-approved drug made by Sterling that was known to help treat this disease. Sterling knew the drug could cause vision problems and warned doctors about this. Brooke warned Coch of the possible side effects of the drug. After three year's use, Coch began to suffer blurred vision, so Brooke stopped prescribing the medication. Later Coch went blind, probably from the drug. Coch sued the doctor and the drug company. in this case a court would probably:

find no liability due to assumption of risk for unavoidably dangerous product

Under the common law doctrine of ____, employers are free to discharge employees for any reason at any time, and employees are free to quit their jobs for any reason at any time.

freedom of employment work at reasonable compensation worker rights fair work Correct answer: none of the other choices are correct

The United States, Japan, Canada, countries of the European Union, and other industrialized nations agreed to eliminate tariffs completely among themselves in which of the following industries:

furniture medical equipment paper pharmaceuticals Correct answer: all of the other specific choices are correct

The first thing the plaintiff must do to begin the litigation process is:

give notice to the defendant by service of process request a pre-trial hearing before a judge serve the defendant with the complaint make a motion for a pleading none of the other choices are correct

In General Electric Business Financial Services v. Silverman, where Silverman failed to repay a loan from GE Financial after his company went bankrupt, despite having signed a guarantee to repay the loan even if the company went bankrupt, the district court:

granted the plaintiff's movement for summary judgment because the Illinois Credit Agreement Act bars affirmative defenses that rely on oral promises that contradict the written terms of the agreement

Which of the following is not a category of agents covered in the text:

gratuitous agent special agent universal agent general agent Correct answer: all of the other choices are covered

The Fair Debt Collection Practices Act prohibits the following by debt collectors except:

harassing, late-night phone calls discussing a debt with neighbors publication of a list of debts owed threatening violence if a debt is not paid Correct answer: all of the other choices are prohibited

In a criminal case the defendant:

has no obligation to disclose evidence to the prosecution that shows the defendant is guilty

A prescription drug is one that:

has serious side effects is expensive requires insurance to purchase may be purchased by anyone Correct answer: none of the other choices are correct

Meiller Co. had a dispute with a Peruvian client over the wording in a contract. The issue ended up in federal court in Miami. The judge ruled that the Spanish version of the contract was controlling. To avoid such problems in the future, what should Meiller do?

have the contract translated into the two languages and include a choice of language clause designating English as the official language

If government agencies fail to enforce environmental statues, citizens:

have the right to bring citizen suits

Which of the following is an example of a class III medical device:

heart valves pacemakers bone implants Correct answer: all of the other specific choices are correct

Lyle is Thelma's agent. Thelma has made it clear to Lyle that she does not want him to sign the contracts that he negotiates; she retains that power. If, despite Thelma's instructions, Lyle negotiates and signs a contract with Tom committing Thelma to spend thousands of dollars, what will the consequences of Lyle's actions be?

if Tom was justified in presuming Lyle had authority to sign the contract, Thelma will be responsible

Ozone is one of the major pollutants that has not decreased significantly in the lower levels of the atmosphere since the passage of the Clean Air Act. It is mostly produced by:

imperfect burning of petroleum products

Which of the following is an effect of the depletion of the ozone layer:

increase in skin cancer more eye cataracts injury to the immune system all of the other specific choices are correct Correct Answer: none of the other specific choices are correct

The doctrine of comparative negligence permits damages to be:

increased by the magnitude of defendants' wrongdoing increased by the amount of plaintiffs' goodwill increased by the amount the judge thinks necessary decreased by the percentage of defendants' negligence none of the other choices

Which of the following is not a function of the Food and Drug Administration?

inspections of food and drug producing establishments drug evaluation studies food additives studies study of veterinary products Correct answer: all of the other choices are functions of the FDA

Mary, who has developed a deep hatred of Joe, disguises her voice and calls him one night claiming to be a nurse at a hospital in the city where Joe's parents live and tells him that his parents have just been killed in a car accident. Joe would be most likely to win a tort suit for:

intentional infliction of emotional distress

Business transactions that involve entities from two or more countries are defined as:

international business

As held by Chief Justice Marshall in Gibbons v. Ogden, commerce among the states means:

interstate commerce

In some states, such as California, proximate cause has been replaced by a negligence rule of liability that holds: A legal cause of injury is a cause which is a(n) ____ in bringing about the injury.

intervening conduct superseding cause sine qua non contributory factor none of the other choices are correct

Unlike real property, personal property:

is immovable is taxable is not taxable is valueless Correct answer: none of the other choices are correct

In cases involving businesses, where the public enters the business as a part of doing business, the law presumes the property:

is safe for public admission

Product misuse can be used as a defense in a product liability suit if:

it can be shown that the product was misused it can be shown that the product was combined with another product to make it dangerous it can be shown that the product was not maintained properly all of the other specific choices are correct

Commercial speech, such as an advertisement, may be regulated if it:

it is not truthful

Every year millions of children are vaccinated against polio. For reasons that are unclear, some children contract polio from the vaccine, even though their dose was no different than the others. Assume that child who contracts polio after receiving a vaccine sues the vaccine maker for damages. The likely result of the case will be that:

it is uncertain if liability will be imposed; FDA approval is not a shield against liability

The primary factors for a pollutant's NAAQS are the public health effects. The secondary factors are:

its considerations of public welfare effects

Don borrows $90,000 to buy a home. His mortgage is with Western Bank. Don is unable to make his mortgage payments. Western forecloses on Don's house and sells it in a judicial sale. The bank gets $95,000 for the house. In this case, it:

keeps the extra money as the new owner of the property keeps the extra money to reimburse it for its expenses must pay the secretary of state for the expenses the office has incurred obtain a mechanic's lien against Don Correct answer: none of the other choices

An undisclosed principle is:

known to the agent unknown to the agent known to third parties to contracts entered into with the agent known to partners Correct Answer: none of the other choices

Which of the following is not real property:

land minerals buildings trees Correct answer: all of the other choices are real property

Governments disfavor bearer instruments because:

law enforcement agencies find it difficult to trace money transferred in bearer form

The person who holds the legal title to a property in a trust is known as the:

leader executive magnate majordomo Correct answer: none of the other choices are correct

The destruction of property by a tenant is called:

leasefeasor domain an eviction seizin Correct answer: none of the other choices

The proximate cause of an injury is the ____ cause of the injury.

legal

Chuck eats two pounds of potato chips a day for 20 years. He becomes obese and dies from high blood pressure at age thirty. Doctors attribute his death to consumption of the chips. In a suit against the chip makers, Chuck's heirs will probably:

lose because of Chuck's assumption of risky behavior

Business organizations lobby Congress to impose federal statutory limits on tort damages because they claim that:

many of the awards are excessive many of the awards are unjustified the costs of the awards are making American business less competitive all of the other specific choices are correct

Monopsony power is:

market power on the buy side of the market

Subsurface mineral rights:

may be legally separated from surface ownership

Activity that "necessarily involves a risk of serious harm to the person, land, or chattels of another, which cannot be eliminated by the exercise of the utmost care" and "is not a matter of common usage" is called:

metahazardous activity superhazardous activity very hazardous activity megahazardous activity none of the other choices are correct

Fred approaches his co-worker Gloria in the office supply room and closes the door. Fred describes, in detail, the porno movie he watched last night. Fred has Gloria "trapped" in the room, causing her to fear that he might try something. Fred says that since they are alone he could show Gloria what the movie was about. Fred:

might be liable for assault

Most companies that file Chapter 11 bankruptcies have assets worth:

more than $1 million at least $5 million more than $1 billion more than $5 billion Correct answer: none of the other choices are correct

Probable cause is:

necessary to obtain a warrant

Criminal acts:

need not be planned

Agents of the Software Agency (SA) check companies to be sure all the software they use is properly licensed, not copied. SA agents arrive at Bob's Drugs to conduct an inspection. Bob asks the agent to see her search warrant, otherwise he will not admit her. The SA contends that a warrant is not needed to conduct a routine search to see if SA regulations are being followed. The Supreme Court is likely to say that warrants by SA officials are:

needed to search business property because the Fourth Amendment (search and seizure) applies to businesses as well as persons

If Andy discovers a defect in the product his company manufactures after the product has already been sold and does not disclose it and Kathleen is injured while using the product she can sue him for:

negligence

Which of the following torts protect individuals from harm from the unintentional but legally careless conduct of others:

negligence

Tort law can be classified as:

negligent intentional strict liability all of the other choices

Fact Pattern 3-2 Ellen contracts with James to be her stockbroker, making stock trades for Ellen's account. Ellen need not pre-approve the trades that James makes, only trades for more than $20,000. Ellen and James include a clause stating "that in case of any disputes arising out of this contract; the dispute shall be arbitrated using the rules of the New York Stock Exchange." Ellen learns that since signing her contract with James, he has routinely been making trades worth more than $20,000 without her permission, and losing money. Refer to Fact Pattern 3-2. Before arbitrating this disputes, Ellen and James might be wise to attempt:

negotiation

The least formal method of alternative dispute resolution is:

negotiation

New plants that discharge pollutants into the waters of the U.S. are subject to:

new source performance standards

Nolo contendere means:

no contest

The Clean Air Act imposes civil penalties on executives of companies violate air pollution standards. If the government sued an executive for violating this law and asked for $100,000 in civil penalties to be imposed, the executive would have:

no right to a jury trial

Kurt works for Jeris. One evening Kurt decides to use the company truck to pick up his date. On his way home from the movies, after dropping his date off, Kurt runs a red light and smashes into Bob. Is Jeris liable to Bob?

no, because Kurt was acting outside the scope of his employment

A statement that is presumed by law to be harmful to the person to whom they were directed and therefore requires no proof of harm or injury is:

none of the other choices are completely correct

Gables purchased used Mercedes from a German company. The cars were built for the German market and met its safety and pollution requirements. Gables hoped to sell the cars in the U.S., and so shipped them to New York. Upon reaching Customs, the cars will:

not be passed through Customs because Germany does not have most favored nation status with the U.S. be passed through Customs because they are not products that would affect U.S. national security not be allowed to pass because they are a major source of competition for U.S. automakers not be allowed because they are not new cars Correct answer: none of the other choices

A company advertises that test driving a car from New York to Los Angeles got 35 miles per gallon. That is true, but the mileage was achieved by carefully driving at the speed limit, which resulted in better mileage than the ordinary driver gets. Under the FTC deception policy, this ad is:

not deceptive; because most consumers understand that test mileage is not the same as regular highway driving

Under the Equal Credit Opportunity Act, lenders can:

not discriminate on religion even if people of that religion frequently default on their loans

World Inc. wanted to sell sugar-free candy made by Sweets (a U.S. company) to an Italian company, Ferraro. The goods were to be paid for by an irrevocable letter of credit issued in the name of World. The letter of credit stated that drafts must be accompanied by a bill of lading, packing list, FDA approvals, and certificates of insurance. Drafts were to be presented to C Bank before March 15, 2009. After shipping the candy to Ferraro, World presented the Bank with the required documentation on March 21, 2009. The Bank should:

not pay the draft because World Trading has not met its contractual obligations under the letter

Biotechnology is:

not subject to TSCA not subject to any kind of federal regulation subject to TSCA in some states but not others completely regulated by the private sector Correct Answer: none of the other choices are correct

If a debtor refuses to pay an unsecured creditor, and the debtor is insolvent, the unsecured creditor collects:

nothing

Clark, a movie producer, was allowed to work at a movie production company's offices (ITC) out of courtesy. His business card listed the ITC address and his phone calls were handled by ITC staff. In the office, he made a deal to produce a movie for another company. When problems developed and the company, presuming Clark worked for ITC, sued ITC. The court would be likely to hold that ITC:

ratified Clark's actions and so became liable for his actions

An alleged principal becomes a real principal by:

ratifying the agreement

When real estate is used as collateral to secure the loan, the note is a:

real estate mortgage note

The Food Quality Protection Act requires that the FDA ensure a ____ from any source that affects foods, raw or processed.

reasonable certainty of no harm

In addition to having the power to decide when drugs and certain food products will be marketed, the FDA can remove products from the market. An example of the FDA's use of its power to remove products from the market is the:

recall of GM trucks from the market removal of animal-tested cosmetics from the market removal of high-fat pork products from the market removal of low-SPF tanning products from the market Correct answer: none of the other choices

Filing for bankruptcy under Chapter 13 of the bankruptcy code results in ____ of debts.

reorganization

The ability of a business to return money earned in a foreign country back to its home country is called:

repatriation

Applied to pollution cases, public nuisance is:

repealed by the Resource Conservation and Recovery Act a term applied to a polluter who causes damage to the air a concept no longer used because of the Clean Air Act an unreasonable interference with a right held by members of the public in common Correct Answer: none of the other choices are correct

Fact Pattern 20-1 MicroManage is the fastest growing home-software producer in the country. In 2000, it sold 6% of all home software in the U.S., but in 2011, it sold 55% of all home software. A recent issue of Computer Universe said that MicroManage was "the most dominant and aggressive of all home-software developers." Home software is a small part of the entire software industry. Under the rule established in Standard Oil Co. of New Jersey v. U.S., a merger between MicroManage and Game Master is likely to result in a:

request by the government that the newly merged company be broken up

Sworn testimony, outside of the courtroom, of a witness recorded by a court official is a:

request for admission production of testimony discovery testimonial demurrer of oath none of the other choices are correct

Suppose both sides in a suit agree about certain facts, so they do not need to be proven at trial. To settle facts about which there is no real dispute, the parties may use:

requests for admissions

The duty of loyalty:

requires a principal to place the agent's interests before the principal's personal interests or those of any third party refers to the medieval roots of agency law requires the agent to work for only one principal at a time requires the agent to work without compensation if necessary Correct Answer: none of the other choices are correct

Camerican contracted with a Turkish company, Hursik, to buy 20,000 tons of tomatoes. Hursik breached its contract with Camerican and sold its products to another buyer for more money. Camerican could sue Hursik in Turkey, or trying to get Hursik into a U.S. court. Camerican might have reduced dispute resolution difficulties by:

requiring that an arbitration clause be placed in its sales agreement

Sometimes the Supreme Court uses the necessary and proper clause to:

respond to new technological developments without requiring amendments to the Constitution

When liability is imposed on an employer for a tort committed by an employee, the liability is based on the rule of law known as:

respondeat superior

A(n) ____ is a RCRA required form that states the nature of a hazardous waste and identifies its origin, shipping route, and final destination.

risk assessment declaration acceptance of responsibility documentation of hazards Correct answer: none of the other choices are correct

For a state to tax a business, the state must have:

rules for apportioning a company's income

For liability to be imposed when negligence is alleged, in many jurisdictions, the injured party must prove that the defendant's act was not only the cause in fact of the injury but also the ____ of the injury.

superseding cause intervening conduct or strict liability misappropriation comparative negligence none of the other choices

The U.S. publishes the duty imposed by customs on products entering U.S. ports in the:

tariff schedules

Proximate cause limits liability to harms:

that bear a reasonable relationship to the defendant's negligent conduct

In U.S. v. Allmendinger, involving an insurance scam run by Allmendinger and others, Allmendinger received a much longer prison sentence than a co-conspiriator, which he appealed. The appeals court held:

that his sentenced was to be reduced because of "extensive cooperation" with authorities investigating the matter that because the Sentencing Guidelines were unconstitutional, he should be resentenced that because no personal injury was inflicted on any person, only financial injury, the sentence should be reduced the sentence should be increased to a higher level than originally imposed because the losses involved exceeded $100 million none of the other choices

Which of the following is a key part of the British constitution:

the Act of Settlement 1701

Which of the following is a key part of the British constitution:

the Magna Carta the Bill of Rights 1689 the Act of Settlement 1701 the Act of Union 1707 all of the other choices are key parts of the British constitution

In an effort to control the depletion of the ozone layer, which of the following treaties was signed in 1987?

the Montreal Protocol

The most famous cartel around today is:

the Organization of Petroleum Exporting Countries

Price discrimination was made unlawful by:

the Robinson-Patman Act

Which of the following statutes concern the consequences of groundwater pollution from agricultural fertilizers and sprays:

the Safe Drinking Water Act

Who is responsible for criminal enforcement of the Foreign Corrupt Practices Act:

the Secretary of State the Secretary of Trade the Supreme Court the Bureau of Trade Management Correct answer: none of the other choices are correct

Which of the following statutes concern the consequences of groundwater pollution from agricultural fertilizers and sprays:

the Toxic Substances Control Act

Which of the following nations have agreed to eliminate tariff completely among themselves in ten industries:

the United States Japan Canada France Correct answer: all of the other specific choices are correct

For an agency to be valid in most states:

the agent must be subject to the principal's control

When the FTC tried to sue a company for scams advertised on the Internet:

the appeals court held the FTC had no jurisdiction on Internet commerce the appeals court held that there could be no suit because of First Amendment rights the appeals court held that there could be no suit because jurisdiction over the Internet belongs to the Federal Communications Commission, not the FTC the appeals court held that there could be no suit because this exceeded the powers of the agency; Congress would have to amend the FTC Act Correct answer: none of the other choices

Nonnegotiable instruments are governed by:

the common law of contracts

Refer to Fact Pattern 19-1. Drugs-R-Us claims in its advertising that "tests prove" the cookies help lose weight. To avoid a charge of deceptive advertising, Drugs-R-Us must show that:

the company has evidence that provides a reasonable basis for its claims

The Clean Air Act established specific procedures for:

the construction of new industrial plants

Public awareness of the effect of pollution on the environment increased during the 1960s, in part due to:

the organic revolution the leaking oil well in the Gulf of Mexico the publication of Rachel Carson's "A Cleaner World" the Exxon Valdez oil spill Correct answer: none of the other choices are correct

Elonis posted violent comments to go with images of his ex-wife on Facebook. He also threatened co-workers and children on the site. He was fired from his job and his ex-wife got a protective order against him. He was arrested and charged with transmitting a threat to injure another person. He appealed that his prosecution and conviction was not proper. The Supreme Court held that:

the conviction was proper as a jury could find that his violent statements showed criminal intent. the conviction was proper as the jury could find that his statements showed that he knew he intended to commit a criminal act. the conviction was reversed because there was no immediate threat of harm to anyone, he was only making statements. the conviction was reversed as the postings were protected speech under the First Amendment. none of the other choices are correct.

An attached interest means:

the customer has transferable rights in the collateral and has signed the debt instrument

Which of the following is listed as suspicious activity by the Internal Revenue Service:

the customer pays cash for products/services using bills having an unusual or chemical-like odor a 16-year-old brings bags of cash to a money transmitter to make a transfer from New York City to Miami a customer conducting an $11,000 cash transaction attempts to bribe a Money Services Business employee not to file a Currency Transaction Report all of the other specific choices are correct

An award is:

the decision of an arbitrator in the arbitration process

Under the merger guidelines a major reason to approve a merger is:

the demonstration that the merger will enhance efficiency in the market

A case is ready to go to trial after completion of:

the discovery process

Which of the following is NOT true about the manifest required by the RCRA:

the economic value of the hazardous waste must be stated

An express contract in employment exists when:

the employer and employee agree on employment for a certain time

In Barabin v. AstenJohnson, where Barabin sued for damage suffered from exposure to asbestos, the appeals court held that the testimony of the plaintiff's expert witnesses was not legally permissible evidence because:

the expert witness's testimony did not meet the Daubert reliability standard

Refer to Fact Pattern 19-2. If Jayme's production plant is found to be contaminated with viruses and bacteria due to poor sanitation on several inspections, then, even if no one can be shown to have been made ill by the problem:

the head of Jayme's could be convicted of a criminal offense

States may not copy federal regulations if:

the imitation promotes interstate commerce the imitation promotes intrastate commerce the imitation inhibits factory production the imitation inhibits intrastate commerce none of the other choices are correct

Which of the following requirements must be met to allow new construction in a prevention of significant destruction area:

the owner must agree to install the best available control technology-as determined by the EPA-on the new plant to control its air pollution the owner must show that the pollution from its plant will not cause the maximum allowable increase in the area to be exceeded the owner must show how the plant will be economically beneficial to the area Correct Answer both a and b are required a, b, and c are required

In Bridge v. Phoenix Bond, where Phoenix Bond sued Bridge for filing false documents related to tax lien purchases, the Supreme Court held that:

the plaintiffs could state a claim as victims of the fraud and sue under RICO

Billy wants to borrow $10,000 to start a male belly dancing business. Creditors are not anxious to lend him the funds. Billy convinces Gary to back-up the credit he gets from a bank. Gary is:

the principal the grantor the testator the detainor Correct answer: none of the other choices

Which of the following would lead to termination by operation of law for an agency:

the principal dies the agent dies the subject matter of the agency is destroyed Correct answer: all of the other specific choices are correct

In practice, the focus of the Endangered Species Act is on:

the purchase of habitat by the Fish and Wildlife Service to expand breeding ranged for endangered species the elimination of hazards, such as pesticides and herbicides, that threaten endangered species breeding programs, often in captivity, to preserve the genetic stock of endangered species all of the other choices are part of the active programs initiated by Congress to protect species Correct Answer: none of the other choices

Ordinary care or due care is a standard of care that the law presumes:

the reasonable person meets

Under the strict liability doctrine, the focus is on the problems with the product, rather than:

the reasonableness of the conduct of the manufacturer

The Clayton Act prevents a corporation from acquiring another corporation if:

the result is that it may substantially lessen competition

Before passage of laws affecting negotiable instruments:

the right to payment was a contract right that could not be sold

Arbitrations are guided by:

the rules of the relevant arbitration association

Dumping is:

the sale of foreign refuse in U.S. markets the export of U.S. goods at market rates charging foreign consumers a higher price than in the home market receiving unfair subsidies for foreign governments Correct answer: none of the other choices

Cashier's checks are frequently used in transactions where:

the seller demands guaranteed payment

In U.S. v. Allmendinger, involving an insurance scam run by Allmendinger and others, Allmendinger received a much longer prison sentence than a co-conspiriator, which he appealed. The appeals court held:

the sentence was justified under the Sentencing Guidelines

Fact Pattern 4-1 You own Priscilla's Pecans. You employ five people and sell your pecan products in one town in Georgia. Your products are not sold in any other state. The federal government imposes regulations on the pecan industry. The Georgia legislature issues its own safety laws that are stricter than the federal rules. Georgia also places a tax on pecan products made out-of-state because it fears those products will not be as safe as those produced in Georgia under the strict Georgia regulations. The regulations raise the cost of doing business. To register your unhappiness with the Georgia regulations you attach a label to your products that alerts customers to the rules and expresses your view that the rules are unnecessary and too costly. You donate $10,000 to the campaign of Lucinda Snopes, a friend who is running for the legislature. She opposes the pecan law. Buddy Reeves, the county attorney, reads the label criticizing the new safety regulations. He draws up a complaint against you and against Priscilla's for distributing inflammatory statements in commerce. He instructs the sheriff to seize your products in order to stop distribution of your statement, which the sheriff do

the sheriff searched your premises without a warrant, thus violating your 4th Amendment rights

The right of the government to conduct eminent domain actions comes from:

the sovereign nature of the government

In Shapero v. Kentucky Bar Association the state bar association prohibited lawyers from soliciting business by sending truthful letters to prospective clients known to face possible legal action. The Supreme Court held that:

the state bar association violated the First Amendment

Economic espionage is:

the theft of valuable business information

Based on the Fourth Amendment, the exclusionary rule allows evidence:

to be introduced at trial, no matter how obtained that is pertinent to "key issues" to be introduced at trial that is gathered by non-government personnel to be excluded at trial that would otherwise be classified as "hearsay" to be used at trial none of the other choices

If the statute of limitations expires on the ability of the state to prosecute for a crime, it is said that the statute has:

tolled

The practice of creating an artificial price to use in its accounts when a firm sells goods from a division located in one country to a division within the U.S. is referred to as:

transfer pricing

Intentional interference against property does not include which tort:

trespass public nuisance private nuisance conversion Correct answer: all of the other choices can be correct

Despite the broad scope of the First Amendment right of freedom of speech, newspapers are not free to print:

truthful stories that harm a person's reputation truthful stories that harm a business' reputation stories of questionable truthfulness that cause no harm print any stories degrading elected federal officials none of the other choices are correct

Computer and internet fraud involves:

unauthorized use of computers and computer files

Wickard v. Filburn concerned the ability of Congress to impose federal controls on wheat production, including a small farm that produced only 239 bushels of wheat, all for use on the farm. The Supreme Court held that the controls were:

unconstitutional since the matter agriculture is exempted from regulation unconstitutional since such a small amount was "insufficient commerce," but the regulations could be written to apply to all active sellers in the wheat market unconstitutional since all of the wheat was sold or used within the state unconstitutional since none of the wheat was sold; all wheat was used on the farm none of the other choices

An agency may not be ended by:

unilateral notice by the agent unilateral notice by the principal mutual consent by agent and principal lapse of agreed-upon time Correct answer: all of the other choices may end an agency

In Consolidated Edison Co. v. Public Service Comm., the New York utility commission ruled that the electric company could not send its customers information in support of nuclear power. The Supreme Court held that the restrictions imposed by the New York utility commission were:

unreasonable

In Wyeth v. Levine, where Levine sued the drug developer Wyeth for failure to warn after she lost her forearm and hand after being given a drug by IV-push, a method known to have risks, the U.S. Supreme Court:

upheld the state court's judgment for Levine because it was not impossible for Wyeth to comply with both federal and state labeling regulations

Which of the following conditions must be met in order for someone to claim land by adverse possession? The adverse user:

uses the land in a visible manner

When liability is imposed on the principal for the unauthorized torts of an agent, it is called:

vicarious liability

In Chuway v. National Action Financial Services, where Chuway received a letter from debt collector National that requested payment of the amount she owed on a debt, the appeals court held that the debt collector:

violated the FDCPA by not clearly establishing the amount of the debt

Mediation is:

voluntary

In U.S. v. Allmendinger, involving an insurance scam run by Allmendinger and others, Allmendinger received a much longer prison sentence than a co-conspiriator, which he appealed. The appeals court held that the sentence:

was justified because Allmendinger did not cooperate in the investigation

In Old Island Fumigation v. Barbee, a fumigation company sprayed two condominiums. Some of the fumes leaked, without Old Island's knowledge, into a third, unprotected condominium. In this case Old Island:

was not liable because adequate warnings had been given was contributorily negligent was subject to comparative negligence was not liable; the owners of the buildings were none of the other choices

In Gieseke v. IDCA, Gieseke formed a company to compete with his old employer and worked with one of the former owners of his old employer in the new company. His former employer moved some of the equipment of the new company and changed its mailing address without permission of Gieseke or his partner. When Gieseke sued his former employer the courts held that the former employer:

was not liable in tort as its actions did not go beyond "normal business activities"

In Gieseke v. IDCA, Gieseke formed a company to compete with his old employer and worked with one of the former owners of his old employer in the new company. His former employer moved some of the equipment of the new company and changed its mailing address without permission of Gieseke or his partner. When Gieseke sued his former employer the courts held that the former employer:

was not liable in tort as its actions did not go beyond "normal business activities" was not liable as Gieseke was not properly licensed was liable for negligent misrepresentation of Gieseke's business to other parties was liable for interference with prospective contractual relations none of the other choices

The Food Additives Amendment (Delaney Clause) to the Food, Drug, and Cosmetic Act was replaced by the Food Quality Protection Act in 1996 because the Delaney Clause:

was not strict enough did not bring about the economic growth it was expected to spark only applied to food and drug producers contracting with the government did not apply to food and drug producers contracting with the government Correct answer: none of the other choices are correct

Green bought a scoop attachment for the front of his tractor that could be used to scoop up grain for his farm animals. After a snow, Green used the tractor to clear his driveway. Because of the cold, the scoop snapped-off and injured Green. In a suit against the maker, Green will likely:

win on basis of design defect

A company packages poisoned wheat to use on farms in the Southwest to kill rats. The package states how dangerous the product is and explains needed precautions. A Mexican farm worker takes some wheat home. Since he cannot read English, he has no knowledge of the danger and feeds the wheat to his family. Two children die. In a liability suit against the poisoned wheat producer, the worker likely will likely:

win; the warning was not adequate given the market where the product was distributed

Under a Chapter 13 proceeding, debts must be repaid usually:

within five years

Under American common law, employees are presumed to:

work at will

Requests for admissions are:

written requests for an admission of the truth in matters relating to the dispute

The Truth-in-Lending Act applies to which of the following transactions?

your friend loans you $4,000 you purchase a condo and get an $85,500 loan for that your company, Shoes, Inc., borrows $10,000 to buy more inventory all of the other specific choices Correct answer: none of the other choices

​Lost Tree began development of a large piece of land on the Florida coast in 1968. In 2004 it received permission from the state to develop some of its property but the Army Corps could not give a wetlands permit. Lost Tree sued, contending the value of its property fell from $4.8 million to nearly nothing. The district court agreed and awarded damages. The court of appeals:

​agreed that there was a takings because more than 99% of the value of the land was lost.

HMA, operator of a hospital, contracted with Emcare to provide emergency medical services to the hospital. Emcare hired Dr. Hamby as an emergency medical physician on a one-year contract. Hamby argued with the manager of HMA about its billing procedure and Hamby was fired by Emcare before the year ended. The appeals court held that Hamby:​

​could sue HMA for tortious interference with c contract.

Kim lost control of his Toyota. The vehicle rolled and he suffered injuries. He sued for design defect because the vehicle lacked electronic stability control, a feature that would have increased his chance of controlling the vehicle so it would not have gone off the road. The appeals court held that:​

​it was appropriate to use risk-benefit analysis in strict products liability cases.